Has the yuan’s global usage hit a wall?

BEIJING, 26 SEPTEMBER 2026 —

Author's note: I thank Zhuowen Li for excellent research assistance. It is widely known that global use of China's currency, the yuan, rose in 2023–24 following Russia's invasion of Ukraine, as sanctions and the related reordering of Russian trade drove geopolitical tailwinds to the yuan, also known as the renminbi (RMB).

China's Cross-Border Interbank Payment System (CIPS) is the main bright spot for the yuan. Many global banks have recently signed on to this system for yuan payments, and the crisis in the Strait of Hormuz seems to have revived its growth. But yuan-denominated volume in Hong Kong's Clearing House Automated Transfer System (CHATS), which handles three times as many payments as CIPS, has plunged since mid-2024.

The yuan's share of payments in the Society for Interbank Financial Telecommunications (SWIFT) network has also fallen from its mid-2024 highs. By this measure, the yuan is the world's sixth most used payments currency, behind even the Canadian dollar. Meanwhile, the US dollar remains unchallenged at historic highs in global foreign exchange payments, and 72 percent of China's trade is still settled in others' currencies.

Nevertheless, CIPS's divergence from these other metrics for the first time suggests that an increasing share of payments using the yuan are bypassing the SWIFT network. It is a sign that China is prioritizing resilience to potential future sanctions and self-sufficiency, even at the risk of diverging from global payment standards.

China has long aimed to make the yuan a more important global currency, in part to reduce strategic leverage that ubiquitous dollar payments give the United States.

In 2023, China's president Xi Jinping called for China to become a "strong financial country" (金融强国) with a "strong currency" that has "wide use in international trade, investment, and foreign exchange markets" and even "status as a global reserve currency." People's Bank of China governor Pan Gongsheng warned in 2025 that a "global dominant currency tends to be instrumentalized or weaponized" and hailed efforts to "weaken the excessive reliance on a single sovereign currency." Beijing has explored many means of boosting the yuan's international use.

But Chinese policymakers have struggled to reconcile the openness that having a major global currency would require with domestic stability reinforced through strict capital controls. Figure 1 shows the yuan's share in the SWIFT network, the global standard for payment messages between banks.

Starting in 2010, measures to make the yuan more freely usable contributed to a steady rise from less than 1 percent to 2.8 percent of global payments in the SWIFT network by late 2015. But use then fell back and stagnated around 2 percent for five years after a sharp depreciation and tightened capital controls.

In late 2023, use spiked after sanctions imposed by every major reserve currency issuer made Russia and other countries more willing to use the yuan. It peaked at 4.7 percent of global payments by July 2024, passing the Japanese yen and Canadian dollar to become the fourth most used. After that peak, the yuan's share fell back to 2.75 percent. The mystery is why.

Chinese economists argue that these data underestimate the yuan's international role for multiple reasons, but here the most relevant hypothesis is that a growing share of yuan payments are using CIPS in a way that no longer goes through SWIFT. [1] Banks around the world typically send and receive cross-border payment messages with SWIFT. But they also generally need interbank clearing and settlement systems like CIPS and/or CHATS to execute those payments, e.g.

to actually move money. [2] Soon after it was founded in 2015, CIPS integrated with SWIFT messaging, which it uses for payments involving CIPS's 1,619 indirect participants. CHATS, a real-time gross settlement system that supports multiple currencies, including the US dollar and the yuan, also uses it.

These systems are interconnected, in that a payment message sent with SWIFT might pass through both CHATS and CIPS on its way through Hong Kong to a mainland Chinese recipient. CIPS, however, also has its own independent messaging system for direct participants. This network of direct participants has grown rapidly from 79 banks since January 2023 to 210 today.

If these banks' yuan payments are the same or growing but they no longer touch SWIFT, this volume could disappear from that data and show a spurious decline in yuan use. [3] Looking at SWIFT and CIPS data together suggest that this volume is in fact disappearing, but adding the CHATS system to the comparison suggests that the SWIFT data showing declining cross-border yuan use are still directionally correct.

Figure 2 shows the payment volume in billions of yuan for CIPS and CHATS. Just like the SWIFT share, both more than doubled from mid-2022 to mid-2024, CIPS from around 350 billion yuan to 770 billion and CHATS from 1.5 trillion to 3.3 trillion yuan. Since the mid-2024 peak, however, the overall trend of yuan volume in CIPS has diverged from that of SWIFT and CHATS.

CHATS volumes and SWIFT shares of yuan both fell, while CIPS volume was stagnant. All have come up from late 2025 lows, but CIPS is registering all-time highs while CHATS and SWIFT remain far below the peak.

Some of the yuan's decline n CHATS may be due to migration to CIPS, but CHATS average daily RMB volume has fallen by over 1 trillion yuan from June 2024 to June 2026, while CIPS volume is only up by one-fifth of that, about 200 billion yuan. CIPS alone cannot therefore explain the CHATS decline.